The phrase “win-win situation” may be overused, but it’s still an important goal for any business. If you can find a way to get more revenue, cut costs, or both, and at the same time help a customer or supplier, why not do it?
Finding creative ways to build business relationships where everybody comes out ahead is more and more essential in today’s economy. At Markraft Cabinets, what started out as a way of cutting costs during the economic downturn has ended up as an important, and growing, branch of our business.
We think it’s a helpful idea that could be adapted to other industries, too.
It’s called Connect 4 Cabinets. It’s a way for contractors, apartment developers, decorators or kitchen-and-bath designers to get direct access to top-quality manufacturers at affordable prices. We act as a middleman, technically a “manufacturer’s representative,” for these smaller companies.
Typically they don’t generate the volume needed to do business with the manufacturers who supply us. We’re fortunate to be able to meet the minimum orders needed to buy directly from the factory, which might be $100,000 or a full truckload of products at a time. So if one of our Connect 4 partners needs to order just one kitchen at a time, they go through us and we add it to one of our orders.
Then when the truck leaves the factory on its way to our warehouses in Wilmington or Nashville, it will also make stops in, say, Knoxville or Charlotte or Charleston on the way, delivering the smaller orders to our direct partners.
What’s in it for us?
One big factor is freight costs. It costs just about as much for a half-empty truck to deliver your products as if the truck was full. So more of our orders ship in full truckloads, and generate added revenue for us, than when we were ordering only for our own needs.
Then there’s that revenue. We’re getting wholesale prices for products that our partners would have to pay retail rates for, if they could get them at all. We’re offering these direct partners a door to the manufacturers that they couldn’t open on their own.
Finally, this helps us build trust with the manufacturers whose products we handle. They are selling more than they would otherwise, but not having to deal with all the sales, recordkeeping and billing issues that we handle for them. This helps us keep the trucks coming with the products we need; it helps the factories keep sending the trucks out.
We started thinking about this idea four years ago, when our business was way down along with everybody else in the housing industry. We started building the partnerships three years ago, and have been reselling products to other dealers for two years now. About a dozen partners are part of the program so far, and we’re actively looking to add more.
Our manufacturers refer potential clients to us, and we’re also promoting the idea at kitchen and bath trade shows.
The Connect 4 program is offered only to direct partners outside our own market, so we aren’t competing with ourselves. And for now, it’s only in the Southeastern states. The direct partners need to be located between us and the factories. That’s so the trucks don’t have to go too far off the direct route to drop those small shipments.
So it really amounts to a three-way “Win-win-win” proposition. The manufacturers make bigger sales, hassle-free. We eliminate waste in our shipping costs, and enjoy an additional revenue stream. And our partners get access to good products, at good prices, that they couldn’t get without our help.
What’s not to like?
I’m always happy to answer any questions about what we can do for you, in your home or for your business. Watch for more tips about how to enhance your home’s value and convenience!
Cee Edwards is President and General Manager of Markraft Cabinets. He joined the company in 1995. Since 1985, Markraft has specialized in cabinet and countertop design and installation in residential and commercial construction and custom remodeling. To learn more about Markraft, go to www.markraft.com. Contact Cee at 910-762-1986. Like Markraft on Facebook at www.facebook.com/markraftcabinets or follow Cee on Twitter at twitter.com/CeeEdwards.
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